Devolution 'would bring jobs holocaust'

JOHN ARLIDGE

Scotland Correspondent

Michael Forsyth, the Secretary of State for Scotland, yesterday launched his most ferocious attack yet on Labour's devolution plans, saying that a tax-raising Scottish parliament would create an economic "holocaust".

A Scottish assembly with the power to raise income tax by up to 3p in the pound - the so-called "tartan tax" - would deliver "a knock-out blow" to Scotland's economy, he claimed. Higher taxation would discourage investment at a time when the Scottish economy was enjoying record growth.

Addressing MPs in Aberdeen at a meeting of the Scottish Grand Committee, the legislative body, Mr Forsyth said: "Nothing could be more damaging to the prospects for jobs than the tartan tax. A Scottish parliament with tax-raising powers would be a jobs holocaust." Labour's proposals were "deeply and utterly irresponsible", he claimed.

But amid rowdy scenes, George Robertson, Labour's spokesman on Scottish affairs, dismissed Mr Forsyth's criticisms. Scotland's economy would thrive under devolution, he said, with decisions taken at local level. Mr Forsyth's arguments were "the usual cocktail of exaggeration, scares, deception and publicly funded propaganda which has become the hallmark of Scottish Office ministers", he said.

Mr Robertson accused Mr Forsyth of "ranting and lying" about a tartan tax and pointed out that under Labour's devolution plans a Scottish parliament could raise or cut income tax.